By Matt Massey, President, drive2
When we meet with companies for the first time, one of the primary questions we get is; "How much will a demand creation program cost?" It's a valid question but not one that's so easy to answer. When a prospective customer asks, we take a marketers approach to the answer – No, that doesn't mean we suddenly get ambiguous and stare off into space…
Simply put, building any demand creation or lead generation program is an evaluation of your investment in corporate marketing infrastructure + tactical program execution divided into an ROI Matrix. The ROI Matrix will output several key figures that will should positively support your marketing investment.
drive2 reviews several key elements within the ROI Matrix to determine overall marketing programs health and individual lead gen. campaign success rates. Here are just a few at a very high level – depending on the complexity of the sale and sales cycle length the ROI Matrices will be more infinitely more complex:
Prospect Acquisition Cost = Tactical Program Cost divided by # Qualified Leads
Customer Acquisition Cost = Tactical Program Cost divided by # New Customers
Campaign Success Ratio = Gross New Customer Revenue divided by Gross Tactical Program Cost
We also don't discount the investment in marketing infrastructure and software has a role to play in determining the true costs of a company's demand creation programs. However these costs can and should be amortized over a period of several years to provide real visibility into each tactical campaign investment.
At drive2, we look at tactical campaign development as another cost that should also be amortized over an extended period. We focus on delivering tactical campaigns that can be duplicated, built upon and we can "shift on the fly" in order to address ever evolving needs of marketing and sales. Advancements in digital printing technology are enabling companies to do more template-driven 1:1 marketing at a lesser cost and the influx of email marketing tools like Constant Contact are allowing companies to reach out to a broader audience with on demand, almost instantaneous response capabilities.
In two words marketing is getting "SCARY PRECISE"! Plus it's getting fun to be a marketer again. Yes, it's still all about the numbers, maybe more so, but at least the numbers give marketers some leverage when its time to sit down with the sales group and discuss marketing vs. sales effectiveness.
drive2 is a demand creation company. We develop performance driven, results-based lead generation and demand creation programs for technology and services companies. For more information on demand creation on how drive2 can work with your company, visit drive-2.com.
